Which of the following is not an objective of financial reporting? Multiple Choice

1. To provide information about the fair value of an entity's economic resources.

2. To report financial performance from the perspective of cash inflows and outflows.

3. To provide indirect information about management's performance in meeting its responsibilities for stewardship of the entity. Incorrect

4. To provide information that is useful to investors and creditors.

Question

Thomas Waller

Business

31 July, 19:35

Which of the following is not an objective of financial reporting? Multiple Choice

1. To provide information about the fair value of an entity's economic resources.

2. To report financial performance from the perspective of cash inflows and outflows.

3. To provide indirect information about management's performance in meeting its responsibilities for stewardship of the entity. Incorrect

4. To provide information that is useful to investors and creditors.

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Answers (1)

Know the Answer?

Owen · Answer 1

The answer is 3. To provide indirect information about management's performance in meeting its responsibilities for stewardship of the entity.

Explanation:

Financial reporting mainly deals with providing reliable and accurate financial information to stakeholders, investors and related parties to ensure a smooth flow of the economic activities.

However, it's not a standard of how the management perform and govern the entity. There are seperate rules and laws to ensure the transparency and the performance of the management.